I.G. Investment Management, Ltd. et al.

Headnote

Passport System for Exemptive Relief Applications -- s. 3.3 of National Policy 11-203 exemption from Section 2.2(1.1) and Section 2.5(2)(a) of NI 81-102 to permit mutual funds to invest directly in securities of IRPF beyond the prescribed limits; exemption from Section 14.2 of NI 81-106 to permit mutual funds to invest directly in securities of IRPF that do not have identical dates for the calculation of net asset value.

Applicable Legislative Provisions

National Instrument 81-102 Mutual Funds, ss. 2.2(1) and 2.5(2)(a).

National Instrument 81-106 Investment Fund Continuous Disclosure, s. 14.2.

June 26, 2009

IN THE MATTER OF

THE SECURITIES LEGISLATION OF

MANITOBA AND ONTARIO

(the "Jurisdictions")

AND

IN THE MATTER OF

THE PROCESS FOR EXEMPTIVE RELIEF

APPLICATIONS IN MULTIPLE JURISDICTIONS

AND

IN THE MATTER OF

I.G. INVESTMENT MANAGEMENT, LTD.

("IGIM")

AND

THE ALLEGRO BALANCED PORTFOLIO CLASS,

THE ALLEGRO BALANCED GROWTH PORTFOLIO

CLASS AND THE ALLEGRO BALANCED GROWTH

CANADA FOCUS PORTFOLIO CLASS

(collectively, the "Proposed Portfolios" and

with IGIM, the "Filers")

DECISION

Background

The securities regulatory authority or regulator in each of the Jurisdictions (the "Decision Maker") has received an application from IGIM, on behalf of the Proposed Portfolios and all future mutual funds structured as 'fund-of-funds' managed by IGIM or an affiliate of IGIM (collectively referred to as the "Portfolios"), for a decision under the securities legislation of the Jurisdictions (the "Legislation") for relief from:

(i) Section 2.2(1) of National Instrument 81-102 ("NI 81-102") to allow the Portfolios to invest a fixed portion of their net assets in Investors Real Property Fund ("IRPF") beyond the prescribed limits;

(ii) Section 2.5(2)(a) of NI 81-102 that IRPF be an investment fund subject to National Instrument 81-101 ("NI 81-101") to allow the Portfolios to invest in IRPF; and

(iii) Section 14.2 of National Instrument 81-106 ("NI 81-106") to invest directly in securities of IRPF that do not have identical dates for the calculation of net asset value

(the "Exemptions Sought").

Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a dual application):

(a) The Manitoba Securities Commission is the principal regulator for this application,

(b) IGIM has provided notice that Subsection 4.7(1) of Multilateral Instrument 11-102 Passport System ("MI 11-102") is intended to be relied upon in British Columbia, Alberta, Saskatchewan, Quebec, New Brunswick, Nova Scotia, Prince Edward island, Newfoundland & Labrador, Yukon, Northwest Territories and Nunavut; and

(c) the decision is the decision of the principal regulator and evidences the decision of the securities regulatory authority or regulator in Ontario.

Interpretation

Terms defined in National Instrument 14-101 Definitions, and MI 11-102 have the same meaning if used in this decision, unless otherwise defined.

In this decision:

(a) "Portfolios" refers to the Proposed Portfolios and other mutual funds for which IGIM, or an affiliate of IGIM, is the Manager and which will:

(i) set a target investment mix based on a strategic asset allocation strategy for its investments in Bottom Funds and the actual investment mix may be adjusted by up to a set percentage above or below such target in IGIM's sole discretion, and

(ii) invest up to 10% of their net assets in IRPF;

(b) "Underlying Funds" refers to any one or more of the mutual funds into which any one or more of the Portfolios may invest their assets (other than cash and cash equivalents), including IRPF.

Representations

This decision is based on the following facts represented by the Filers:

Background

1. IGIM is a corporation continued under the laws of Ontario and it, or an affiliate of IGIM, will manage the Portfolios and the Underlying Funds. The head office of IGIM is in Winnipeg, Manitoba. Each of the Portfolios and Underlying Funds is, or will be, distributed in Manitoba and the other Jurisdictions.

2. The Portfolios will achieve their investment objectives by investing:

(a) in Underlying Funds in accordance with a target investment mix based on a strategic asset allocation strategy for its investments in the Underlying Funds where the actual investment mix may be adjusted by up to a set percentage above or below such target in IGIM's sole discretion, and

(b) up to 10% of their net assets in IRPF.

3. Each of the Portfolios will be a separate class of shares issued by Investors Group Corporate Class Inc. (the "Corporation"), a corporation governed by the Canada Business Corporations Act.

4. Each of the Underlying Funds will be an open end investment trust established under the laws of the Province of Manitoba.

5. Each of the Portfolios and the Underlying Funds is, or will be, a reporting issuer in each of the provinces and territories of Canada and is not in default of any of the requirements under the securities legislation of the Jurisdictions (the "Legislation").

6. Securities of the Portfolios and the Underlying Funds are, or will be, qualified for distribution in all of the provinces and territories of Canada pursuant to a simplified prospectus and annual information form or, in the case of IRPF, the Alternative Prospectus, as defined below.

Subsections 2.5(2)(a) -- Investment in IRPF

7. In order to achieve the investment objectives of the Portfolios, IGIM, using strategic asset allocation, will invest fixed percentages of the assets of the Portfolios (other than cash and cash equivalents) in securities of IRPF, provided that the investment by a Portfolio in IRPF shall not exceed 10% of the assets of the Portfolio, subject to a variation of 2.5% (the "Permitted Ranges") to account for market fluctuations. Investments of each Portfolio will be made in accordance with its fundamental investment objectives.

8. The simplified prospectus of each Portfolio will disclose the specific risk factors and restrictions associated with investments in IRPF.

9. The Portfolios will not invest in an Underlying Fund with an investment objective which includes investing directly or indirectly in other mutual funds, except as permitted by NI 81-102.

10. The investments by the Portfolios in the securities of the Underlying Funds will represent the business judgment of responsible persons, uninfluenced by considerations other than the best interest of the Portfolios.

11. Except to the extent evidenced by specific approvals granted by the Decision Makers pursuant to NI 81-102, the investments by the Portfolios in the Underlying Funds will be structured to comply with the investment restrictions of the Legislation and NI 81-102.

12. Section 2.5 of NI 81-102 permits mutual funds to invest in the securities of other mutual funds subject to certain restrictions (the "Fund-of-Funds Rules"). The Portfolios are in compliance with the provisions of the Fund-of-Funds Rules, except with respect to the requirement that all Underlying Funds be subject to NI 81-101 because IRPF is not directly subject to the requirements of NI 81-101. Although IRPF is not directly subject to NI 81-101, by decision of The Manitoba Securities Commission dated May 26, 2009 (SEDAR Project #1388340), IRPF is required to file a prospectus in accordance with NI 81-101 and containing additional disclosure or alternate disclosure relevant to IRPF ("Alternative Prospectus").

13. In the absence of the relief requested of the Decision Makers under this Application, the Portfolios would not be able to invest directly in the securities of IRPF.

General

14. IGIM believes that the relief sought under this Application will be in the best interests of the securityholders of the Portfolios as it will provide them with a balanced investment with limited exposure to the real property sector at a modest cost.

15. IGIM believes that the relief sought under this Application will be in the best interests of the unitholders of IRPF because investment by the Portfolios in IRPF provides IRPF with greater assets than might otherwise be the case which results in various beneficial opportunities for IRPF.

16. IGIM is not in default of securities legislation in any jurisdiction.

Decision

Each of the Decision Makers is satisfied that the decision meets the test set out in the Legislation for the Decision Maker to make the decision.

The decision of the Decision Makers under the Legislation is that the Exemptions Sought are granted provided that:

1. in all other respects, at the time a Portfolio makes or holds an investment in IRPF, the investment shall comply with the requirements of NI 81-102;

2. the simplified prospectus of the Portfolios disclose the specific risk factors and restrictions associated with investing in IRPF; and

3. the investment by a Portfolio in IRPF shall not exceed 10% of the assets of the Portfolio, subject to variance within the Permitted Ranges.